Ties to gov., clients put NC law firm in spotlight

Saturday

May 4, 2013 at 12:01 AMMay 4, 2013 at 12:36 PM

Nearly four months into his job as North Carolina's governor, Pat McCrory's former employer is receiving unaccustomed public attention for its behind-the-scenes role in some of the state's biggest news stories this year.

EMERY P. DALESIO - Associated Press

RALEIGH, N.C. (AP) — Nearly four months into his job as North Carolina's governor, Pat McCrory's former employer is receiving unaccustomed public attention for its behind-the-scenes role in some of the state's biggest news stories this year.

Charlotte-based business law firm Moore & Van Allen negotiated a package of tax breaks and other incentives that could provide nearly $100 million to MetLife Inc., which decided in March to move about 2,600 jobs from five states to Charlotte and the Raleigh suburb of Cary.

And the firm's bulked-up lobbying arm has pulled Moore & Van Allen's name into an ongoing story about political campaign contributions and video gaming parlors that state legislators have tried to close for more than a decade. A sweepstakes operator interviewed by The Associated Press said he and another man hired the firm and contributed to McCrory's campaign because they wanted state politicians to legalize the games that critics say skirt anti-gambling laws.

At the heart of both cases is whether a company unknown to most North Carolinians has an outsized clout because it employed McCrory for nearly three years. The governor said he played no role in shaping the incentives deal that helped attract MetLife. Emails released by McCrory's aides and state business recruiters show nothing to the contrary.

Moore & Van Allen Chairman Ernie Riegel said his firm didn't hire McCrory— who was not a lawyer or registered lobbyist — in January 2010 because partners thought he would be the next governor.

"The 21st century law firms don't just have lawyers in them," Riegel said. "You've got people who add value to what lawyers could do, and Pat was one of those people."

McCrory has never clearly described his duties at the job he started after nearly three decades at Duke Energy and a record 14 years as Charlotte's mayor. While at Moore & Van Allen, he also worked for his brother's consulting firm, served on online mortgage service LendingTree.com's board of directors, and then ran for governor.

McCrory said in a March 15 interview with the AP that he didn't engage in any conversations or strategy sessions on sweepstakes legislation while working at Moore & Van Allen. Spokeswoman Kim Genardo later clarified that as a candidate, McCrory "met with representatives both for and against the sweepstakes issue."

McCrory has said that while at Moore & Van Allen, he did "client development work" and offered the firm's lawyers "strategic planning on policy issues." He said that he didn't consult with clients who were seeking tax breaks or other economic benefits from state government and that none of his work was billed to any specific clients. He refused to describe how he filled a normal work day, noting that Democrats made his work at the firm an election issue last year. His office said the governor was not available for an additional interview last week.

McCrory was hired to act as an in-house consultant on infrastructure, transportation and other urban development issues to Moore & Van Allen's roughly 300 lawyers, Riegel said. McCrory had previously built a reputation as mayor as an advocate for mass transit and, as a former electric utility executive, an authority on energy networks.

Riegel said that if a client working on a development project in a Texas city, or a company considering investing in such a project, was talking to Moore & Van Allen to figure out an approach, "we've got somebody on our staff, in Pat's case a non-legal professional, who's got some knowledge and expertise in dealing with that.

"Our lawyers or our clients can draw on that expertise in terms of just talking through things. That can be valuable, and proved to be valuable in certain situations," Riegel said. He did not give examples.

The interest in the ties between McCrory and his former employer is unusual for a corporate law firm more at home structuring venture capital or suing companies that steal trade secrets.

John Wester, who practices law at Charlotte-based rival Robinson Bradshaw & Hinson, said Moore & Van Allen's reputation allows it to recruit some of the country's highest-ranked law students against rivals in New York and Washington.

"It is an extraordinarily fine law firm, and I'm very high on them," said Wester, a past president of the North Carolina Bar Association.

Moore & Van Allen is the state's second-largest law firm by number of attorneys, according to an annual survey by the trade newspaper North Carolina Lawyers Weekly. The firm's lawyers generated $590,000 each in revenue and $855,000 in profits per partner in 2011, according to annual figures compiled by national trade publication The American Lawyer. That was the fourth most-profitable of the five North Carolina firms tracked by the publication in its most recent estimate.

The 63-year-old law firm grew in tandem with an important client — Bank of America, which burgeoned through several mergers, said Martin Brinkley, who spent the first decade of his 20-year career at Moore & Van Allen. Banking law remains "a longstanding strength of the firm," he said. "It goes back many, many years."

But the recession forced Moore & Van Allen to shed attorneys and other employees. Those layoffs have since been reversed and employment is at or above pre-recession levels thanks to expanded teams focused on intellectual property law, litigation, and lobbying, Riegel said.

The firm's lobbyists registered in Raleigh expanded from one person representing two clients in 2010 to six lobbyists with more than a dozen clients this year.

Moore & Van Allen's lobbyists advocate for Bank of America, a group that sought taxpayer help to upgrade the Charlotte stadium where the NFL's Carolina Panthers play, and the American Petroleum Institute, which wants the state to open up offshore drilling and underground fracking for fossil fuels.

The lobbying arm dropped Oklahoma sweepstakes software company IIT LLC as a client when owner Chase Burns was arrested in March in connection to a veteran's charity that Florida prosecutors say was a front for a $300 million illegal gambling enterprise. Records show Burns made $235,000 in political donations to more than 60 elected North Carolina elected officials before the 2012 election, including McCrory, Senate leader Phil Berger and House Speaker Thom Tillis. Public records obtained by the AP show that most of the checks from Burns were mailed to the candidates by lobbyists at Moore & Van Allen.

Sweepstakes operator William George of Rock Hill, S.C., told the AP that he and others pitched in with Burns to hire Moore & Van Allen because McCrory was widely viewed as the state's next governor and the firm had the political connections needed to shepherd the industry's legalization through the GOP-dominated North Carolina General Assembly.

Bob Phillips, state executive director of the government watchdog group Common Cause, said the episode "speaks to the problem of big-money politics."

"There are reasons why big donors are providing the money — because they want some kind of action to occur," he said.